Implications of Imported Fuel on Pakistan’s Energy Security | Daily Writeup | Opinions
The following articleof CSS Pakistan Affairs is solved by Laiba Shahbaz under the supervision of Howfiv’s Pakistan Affairs Coaches. She learnt how to attempt 20 marks question and essay writing from Sir Syed Kazim Ali, Pakistan’s best CSS and PMS English essay and precis teacher with the highest success rate of his students. This solved past paper question is attempted on the pattern taught by Sir to his students, scoring the highest marks in compulsory and optional subjects for years, and uploaded to help aspirants understand how to crack a topic or question, how to write relevantly, what coherence is, and how to include and connect ideas, opinions, and suggestions to score the maximum.
Outline
1- Introduction
2- Current Situation of the Energy Sector in Pakistan
- In 2021, Pakistan imported $5.23 in crude petroleum from UAE, Saudi Arabia, Kuwait, Qatar and South Africa. Also, in 2022, 35.31% of Pakistan’s total trade was crude petroleum.
3- What impact does Pakistan face because of imported fuel on its economy and energy security?
- ✓ Mitigate energy security
- The Hubco power plant was operationalized in 1997, with the help of the government and foreign investors, solving the energy crises of that time.
- ✓ High energy cost
- A small industry, ABC textile mill in Karachi, faced a 50% rise in its electricity expenditures in 2022. It leads to decreased production and minimum profit. As a result, hundreds of people have to leave their jobs because the industry cannot pay.
- ✓ Foreign fuels in the form of fossil fuels emit more CO2
- According to the Inter-governmental Panel on Climate Change IPCC, because of burning fossil fuels, almost 89% of carbon dioxide is emitted globally, which is the biggest reason for global warming worldwide
- ✓ Decrease in economic growth
- Almost 40% of Pakistan’s textile industries have been shifted to Bangladesh for similar reasons. Also, According to a case study, “Pakistan energy crises”, the state spends a considerable chunk of its resources on buying fuel.
- ✓ More dependence on imported oil
- According to a case study titled “Pakistan energy crises,” Pakistan is so dependent on its oil imports that almost 70% of the state’s electricity use depends on them.
4-Recommendations for Pakistan to deal with its energy crisis
- ✓To make effective policies
- ✓To diversify resources of energy
- ✓To increase dependency on low-carbon energy systems and renewable sources of energy
- ✓To focus on the construction of dams and reopening of closed projects
6- Conclusion
Answer to the Question
Introduction
Energy is an essential sector of a state where its other institutions run. Pakistan possesses almost 37,261 MW of electricity production capacity. Pakistan has been using various types of fuel for this purpose. But the country’s 70% electricity consumption depends on imported fuel: oil, coal and Natural gas. Imported have severely impacted the state. Pakistan is facing a decrease in energy security, an expensive electricity cost, worse environmental crises, a decrease in economic growth, and more dependence on imported oil. This could be solved by making effective policies, diversifying energy resources, increasing dependency on low-carbon energy systems and renewable energy sources, and focusing on the construction of damsand reopening of closed projects. Thus, this question analyses the impacts of reliance on imported fuel on Pakistan.
Current Situation
Currently, Pakistan has been suffering from severe energy crises; moreover, dependence on imported fuel has further aggravated the situation. Dependence on foreign fuel further leads Pakistan to increase fuel prices and grow in debt as the state is unable to manage its resources. In 2021, Pakistan imported $5.23 in crude petroleum from UAE, Saudi Arabia, Kuwait, Qatar and South Africa. Also, in 2022, 35.31% share of Pakistan’s total trade was crude petroleum. This evidence is enough to show that Pakistan imports the most significant chunk of fuel from outside. Hence, it is harming its economy and energy security badly.
What impact does Pakistan face because of imported fuel on its economy and energy security?
- Mitigate energy security
Due to importing oil, coal, and natural gas in liquid form, Pakistan has been suffering from the worst energy crises. The state has been dealing with such issues throughout its history. Because during the Benazir and Nawaz Sharif governments of the 1990s, these politicians found it easy to buy fuel from outside rather than searching inside the state. Such policies and decisions soon led the state’s economy into sustainability crises, and Pakistan was unable to meet the need for energy. During such a situation, the Hubco power plant was operationalized in 1997, with the help of govt. Foreign investors solved the energy crisis of that time.
- High energy cost
Pakistan has been plunged into a vicious cycle of crises where each problem became the reason for another issue, and it keeps going on without stopping. Because of Imported fuel, the cost of energy has been abruptly high in Pakistan. As compared to other states in the region, Pakistan has 45% more expensive electricity. Rising prices of energy have been a nightmare for industries, offices and factories. For example, a small industry, ABC textile mill in Karachi, faced a 50% rise in its electricity expenditures in the year 2022. It leads to decreased production and minimum profit. As a result, hundreds of people have to leave their jobs because the industry is unable to pay. Thus, it was the situation of an mid-level sector having less than a thousand workers. Today, almost every other institution faces the same issue. Therefore, it is destroying the state’s economy.
- Foreign fuels, being in the form of fossil fuels, emit more CO2
Pakistan mainly imports oil, coal and liquid natural gas from outside. These fuels are a kind of fossil fuels and are primarily obtained from fossil fuels. These fuels emit Greenhouse gases such as carbon dioxide, Methane, Nitrous oxide, and chlorofluorocarbons. When a state burns them, it causes severe environmental crises. According to the Inter-governmental Panel on Climate Change IPCC, because of burning fossil fuels, almost 89% of carbon dioxide is emitted globally, which is the biggest reason for global warming worldwide. The population living near those areas suffered from diseases. Moreover, it leads to climate change. And Pakistan is one of those states that have been suffering severely from climate change. Thus, importing and using foreign fuel has severely impacted the environment of a state, which would eventually increase another burden on the state’s economy.
- Decrease in economic growth
Buying imported fuel has not been easy for Pakistan’s economy. It took thousands of dollars to buy them. That’s why it has always been a burden on the state’s economy. Moreover, imported leads to expensive electricity. Expensive electricity is not suitable for Pakistan’s industries and factories. Almost 40% of Pakistan‘s textile industries have been shifted to Bangladesh for similar reasons. Various businesses and factories are on the verge of collapse. According to a case study, “Pakistan energy crises”, the state spends a considerable chunk of its resources on buying fuel. Such fuel is a short-term solution to Pakistan’s energy problems, but in the long term, it always creates hurdles and burdens for Pakistan’s economy. Moreover, the revenue generated from the energy sector of Pakistan is negligible because of inefficiencies and lack of reforms. Thus, in this grave situation of Pakistan’s economy, buying expensive oil could never be an intelligent solution.
- More dependence on imported oil
Due to inefficient policies and the inability to make long-term solutions, Pakistan still keeps on buying foreign fuel. And today, because of growing debt, Pakistan can’t escape the self-made trap. Thus, it is dependent on foreign fuel. Prices of foreign fuel have been a constant burden on its reserves, and also increasing trade deficit. Also, owing to the unprecedented international situation, the prices of fuel have permanently changed. For example, during the Russia-Ukraine war, it became difficult for Pakistan to arrange even some barrels of oil for the state. Still, Pakistan has been dependent on imported oil for its needs. According to a case study, “Pakistan energy crises”, Pakistan has been dependent too much on its oil import that almost 70% of the use of electricity of the state depends upon this. Thus,Pakistan has been unbelievably reliant on fuel imports.
Recommendations for Pakistan to deal with its energy crisis
Pakistan can solve this problem by making effective policies and implementing them. Effective policies could decrease Pakistan’s dependence on foreign fuel, minimize its energy costs, and increase its energy costs. Moreover, rather than relying on imported fuel, Pakistan needs to search for varying sources of fuel. Using low-carbon energy and renewable sources could solve various problems. It would save not only the economy but also the environment of Pakistan. Lastly, the construction of dams and focusing on closed projects could solve the problem in the long term.
Conclusion
In conclusion, Pakistan has been facing worst energy and economic challenges. Expensive foreign oil has been worsening the issue. Expensive imported oil leads to expensive electricity, which burdened industries or factories. In turn its effects the economy of Pakistan. In this way, this vicious cycle never stop. Pakistan can decrease its dependence on foreign oil, and by making effective policies, it can come out from this crises.
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